The Tier III myth

[Jericho]

Bad deal for the ACC anyway you spin it.

BTW, are you an ACC fan?

Not an ACC fan per se. I've always like basketball and therefore like the basketball conferences. So I do prefer the ACC over some other conferences.

Although I'm not sure why the ACC deal is per se "bad". I'll freely admit that other conferences got better deals (Big 12, Pac 12), but I'd also say the ACC is near the bottom of the big conferences in football and therefore should get paid less that places like the Big 10 and SEC. I think the deal puts the conference in the ballpark financially, which in the end is really all that matters. I don't see it as some huge negative or anchor to the conference.

 

[rdmscribbles]

Texas fan here. I think the ACC's selling of tier 3 was a mistake, simply because it can be turned into more money if used differently. They still think like all conferences did ten years ago, but the financial landscape (and mindset of the other major conferences) has changed dramatically since then.

The ACC has one giant advantage over the other power conferences that they haven't leveraged: population. In the past that didn't mean much, since it never translated to a much higher viewership of their actual games, but that changed with the discovery of the conference network model. All of a sudden, conferences can get cash based on the number of tv sets in the area, not just the ones watching. That could solve all of the ACC's financial problems in one fell swoop. Now it's easier said than done. It takes a lot of start up capital. And getting cable companies to carry it on basic packages is a huge fight, as the longhorn network has proven. But ultimately it would be far more profitable if used that way rather than as a minor perk in the media deal- a perk that simply gives ESPN more content they can stream online.

 

[uconnfan68]

Texas fan here. I think the ACC's selling of tier 3 was a mistake, simply because it can be turned into more money if used differently. They still think like all conferences did ten years ago, but the financial landscape (and mindset of the other major conferences) has changed dramatically since then.

The ACC has one giant advantage over the other power conferences that they haven't leveraged: population. In the past that didn't mean much, since it never translated to a much higher viewership of their actual games, but that changed with the discovery of the conference network model. All of a sudden, conferences can get cash based on the number of tv sets in the area, not just the ones watching. That could solve all of the ACC's financial problems in one fell swoop. Now it's easier said than done. It takes a lot of start up capital. And getting cable companies to carry it on basic packages is a huge fight, as the longhorn network has proven. But ultimately it would be far more profitable if used that way rather than as a minor perk in the media deal- a perk that simply gives ESPN more content they can stream online.

If it were just about tvs in a viewing area, the Big East wins hands down. The problem is that they aren't the top pick to watch.

 

[nelsonmuntz]

If it were just about tvs in a viewing area, the Big East wins hands down. The problem is that they aren't the top pick to watch.

The Big East does fine in the ratings. The Texas poster is right that these TV contracts are life and death for a league. The Big East never recovered from signing a TV deal in the 90's with BCU caught in a gambling scandal and Miami facing the death penalty while Rutgers and Temple were two of the worst programs in D1. That lousy deal led to the 2003 raid which led to another bad contract which left the Big East vulnerable to another raid a year ago. A league must maximize its TV contract every time, or it becomes vulnerable. The ACC didn't do that.

 

[huskypantz]

One thing that's not really brought up in these parts - at this point in the game, why does UConn, UL, ND (nonfootball) etc have to share its tier 3 rights with the rest of the BE? I know that's part of the BE agreement, but if they're going to renegotiate their TV deals, that should be on the table too.

 

[RS9999X]

Texas fan here. I think the ACC's selling of tier 3 was a mistake, simply because it can be turned into more money if used differently. They still think like all conferences did ten years ago, but the financial landscape (and mindset of the other major conferences) has changed dramatically since then.
.

i

My understanding is that Raycom was involved in the ACC ESPN contract and is still involved in production and distribution. The ACC does earn Tier 3 as part of the ESPN package if that makes sense. Not every conference is the same.

http://en.wikipedia.org/wiki/ACC_Network#ACC_Network

 

[RS9999X]

More Swofford, ACC, ESPN, Tier 3 and Raycom incest from Sports Business Daily.

Good old boys at work.

http://www.sportsbusinessdaily.com/...story-With-ACC-Secures-Future-For-Raycom.aspx

 

[Jericho]

The Big East does fine in the ratings. The Texas poster is right that these TV contracts are life and death for a league. The Big East never recovered from signing a TV deal in the 90's with BCU caught in a gambling scandal and Miami facing the death penalty while Rutgers and Temple were two of the worst programs in D1. That lousy deal led to the 2003 raid which led to another bad contract which left the Big East vulnerable to another raid a year ago. A league must maximize its TV contract every time, or it becomes vulnerable. The ACC didn't do that.

I can't sit here and say it wasn't a factor, but Miami always wanted to be in the ACC. Geographically it makes great sense and academically it was a huge win. But when the ACC went to expand in the 1990s, Miami was under the aforementioned problems with the NCAA. So the ACC passed and took FSU (a much weaker academic school). For about a decade, Miami tried to undo that decision and in 2003 it finally got enough votes to be welcomed in by the ACC (they needed 7 of 9 and Duke and UNC were constant no's). The other movement that year seemed to be in response to Miami leaving (i.e. Virginia Tech did not want to be in a football conference without a stud school like Miami and forced there way in). So in the end, even a sweetheart TV deal might not have made one lick of difference.

 

[WestCoastHusky]

FSU just proved what I been saying about the ACC TV deal. It really sucks. I hope BE learns that lesson and keep that in mind when we go for the new TV deal. It seems whoever has the highest payout per school can raid whoever has the lesser payout per school. B12 was dying less than a year ago and now they are the aggressor and the ACC is crapping in their pants. It will be good to see ACC get a taste of its own medicine.

It really is important for UCONN to keep its own tier-3 rights.

 

[nelsonmuntz]

The crazy thing about this ACC deal is that it appears to be much better for UConn than it would be for FSU. UConn's Tier 3 for football are not worth much at all, but the basketball Tier 3's would be very lucrative. Since the ACC schools keep the Tier 3's, that league has become even more attractive to UConn.

 

[RS9999X]

The ACC Tier 3 deal doesn't include stuff like radio and coaches shows

It does include television Tier 3, the ACC Network branding, ACC Corporate Partners, the ACC Web site, Digital media rights for streaming and archived telecasts.

Here's the Tar Heels other Tier 3 Partner:

Tar Heel Sports Properties, a division of Learfield Sports, manages the multi-media rights for The University of North Carolina Athletic Department. THSP specializes in managing, packaging, and selling marketing and sponsorship opportunities related to North Carolina athletic events. THSP offers corporate partners a multitude of marketing and media sponsorship opportunities including the following: Signage, Videoboard Promotions, On-field/On-court Promotions, Radio, Print, Internet, Television Coaches Shows, Game Sponsorships, Special Event Title Sponsorships, and Hospitality Events.

 

[observer]

Hm, apparently there is no pot of third tier right gold at the end of the rainbow for FSU in the Big 12:

http://dev.chuckoliver.net/2012/05/third-tier-rights-defined-perspective-on-their-value/

 

[whaler11]

Hm, apparently there is no pot of third tier right gold at the end of the rainbow for FSU in the Big 12:

http://dev.chuckoliver.net/2012/05/third-tier-rights-defined-perspective-on-their-value/

Wow, actual sanity in an article. Nice to see.

 

[junglehusky]

Wow, actual sanity in an article. Nice to see.

And actual analysis.

 

[RS9999X]

It doesn't address the real issue: what would FSU pull in in 2014 as a B12 member versus an ACC member.

The base contact is higher in the B12, the conference game would add dollars, the BCS or post-BCS bowl distributions, and likely a much higher starting figure in year 1 of a Big 12 contract compared to the backloaded ACC contract. Then there's FSUs ticket sales problem: of 10,000 a season over a decade playing BC and Wake and Murray State.

I'll end up sending Chadd Scott a request for more info on the Raycom deal with the ACC and ESPN North Carolina's media rights for local radio, etc. which some say is a fair sum--unusually large.

 

[Jericho]

Hm, apparently there is no pot of third tier right gold at the end of the rainbow for FSU in the Big 12:

http://dev.chuckoliver.net/2012/05/third-tier-rights-defined-perspective-on-their-value/

That was the whole point of this thread, although it took a long time for people to actually believe it.

What is not mentioned is that before the LHN, Texas was making $10 million per year on its Tier 3 rights. It's also not mentioned that a portion of that $15 per year is paying off old contracts. So it only netted the school $11 million last year. Compare that to the $6.5 FSU allegedly pulls in.

The article does a good bottom line summary of what Tier 3 would get FSU, one football game and 4 basketball games (give or take). It wasn't that long agao that Nebraska was PPV football games and selling them for $200,000. It's hard to imagine those few games pulling even $500,000. Which means any financial move for FSU would have to be solely based on the main TV contracts.

 

[whaler11]

How do you build anything of value out of a single game against an FCS team.

Didn't Texas try to use their game with Rice to leverage systems and get nowhere?

Either the women's hoop, baseball and olympic sports have value or they don't. The fact you can add a single home game against an FCS team doesn't make chicken s*** into chicken salad.

Florida State is not Texas. They aren't even the biggest draw in their own state, despite the ACC's attempts to make up ground on the SEC they have barely made a dent. Playing the ACC tourney in Tampa only annoyed their core fan base. I was in Tampa while the tourney was there - nobody seemed to give a damn.

 

[WordUpBU]

That was the whole point of this thread, although it took a long time for people to actually believe it.

What is not mentioned is that before the LHN, Texas was making $10 million per year on its Tier 3 rights. It's also not mentioned that a portion of that $15 per year is paying off old contracts. So it only netted the school $11 million last year. Compare that to the $6.5 FSU allegedly pulls in.

The article does a good bottom line summary of what Tier 3 would get FSU, one football game and 4 basketball games (give or take). It wasn't that long agao that Nebraska was PPV football games and selling them for $200,000. It's hard to imagine those few games pulling even $500,000. Which means any financial move for FSU would have to be solely based on the main TV contracts.

OU's tier three tv rights are going to reap 5m in addition to their radio and existing tier 3 deals that compare pretty even with existing ACC deals. OU already has deals comparable to FSU's 6.5m one. The tv rights are expected to generate ANOTHER 5m on top of that.

UT gets 11-12m right now for the LHN on top of what they already got for non-tv tier three.

Read the really long post I relayed earlier in the thread.

It adds significant revenue but not so much that tier one and two contracts won't be the deciding factor.

 

[WordUpBU]

What happens to a school's self negotiated tier 3 deals if their conference signs an agreement that includes tier 3 rights?

I would not want to be a part of a conference that requires us to cede our tier 3 rights.

Usually the league only takes tier 3 TELEVISION, not the rest of it. So you'd at most be kissing the 1.4mm women's hoops goodbye but they'd probably be left out.

I think the Big 12 leaves 1 football game, 8 mbb, and even more wbb and baseball out. Schools can then sell them on top of the existing tier 3 deals. So if UConn had those rights back from the BE they'd be able to sell those 8 MBB games and 1 FB game for probably much more than the 1.4mm they got for WBB.

 

[WordUpBU]

And I think people misread the $15 million they are getting. They're not getting $15 million for one football game and a few basketball games and all the sports no one watches. They're getting $15 million for everything. The same things UConn currently gets $8 million for with some extra games thrown in.

Dead wrong. Texas is getting 12.5 of the 15 million on top of the 9.4mm they get for an existing deal like UConn's. The 2.5 missing goes to IMG to cover overlapping rights.

That is why it was such a big deal.

 

[uconnfan68]

No school has moved for purely financial reasons?? So West Virginia moved to the Big XII for the academics? The natural rivalries? The better basketball? To make it LESS likely to ever reach a BCS bowl?

sorry to be the cynic, but I am just curious why you think WVA split then. And don't tell me stability because a long term financial commitment is what is giving the stability.

All of this movement is a pure money grab, colleges are now under pricing pressures and they can't just charge what they want anymore, so they need to find new revenues sources to find more money, and lo and behold, hello Big XII. some schools are less beholden to the money then others, no doubt, but that is a minority. The stadiums, practice facilities, coaches salaries, schollies, they all need the oxygen that cash provides.

It was all for academics.